4imprint Share Discussion Threads

[muffster] 16/3/2012 17:44

Paul, DTG is a great find, well done. Shall monitor and invest.
Also have a look over my favourite undervlued shares, WTM, RHL and SHFT. WTM is my fave as Peter Gwyllenhammer, who has invested.

[trademap] 08/3/2012 20:59

Paul
DTG is a company that perhaps looks even more undervalued.

[battlebus2] 08/3/2012 08:53

The dividend won't be a problem with the growth in profits.

[paul_butcher1999] 08/3/2012 08:46

fact it keeps growing 20-30% a year with no let up pretty good sign though ... 5-7% dividend for company which is growing rapidly and consistently ... insanely undervalued. Let me know if there are any other shares as undervalued as this! thanks

[penpont] 07/3/2012 13:49

Anyone have a view on whether they will maintain the divi from here on in or lower it proportionately with the eps reduction?

[jbarker5555] 07/3/2012 13:09

What`s happening with the trades here? Bid and ask shows 239 and 250 yet I can sell at 245.5? And no level 2 data showing through Quotestream?

chrisb - my thoughts too. One thing that keeps me interested is the share options the directors have but I can`t see anything in the results to move the share price in the short term. AIMO :)

[chrisb1103] 07/3/2012 09:52

Hmm not too impressed myself. Sorting the pension deficit is good news, having a chunk of net cash on the balance sheet yeah, but selling a highly profitable unit pretty cheaply to do that...? the hit to eps in the "new" business as others have flagged also concerns me - underlying eps of 22.01p FY 2011 implies a trailing PE of 11? it's been a very long time since the market has valued FOUR on a rating like that. Maybe i'm wrong but can't see this making much progress from here. Better opportunities elsewhere imo. So pretty sadly actually, i'm out - and will wait and see.

[battlebus2] 07/3/2012 07:16

Financial highlights

-- Revenue was GBP158.82m (2010: GBP143.72m), an increase of 11%
-- North American Direct Marketing revenue was US$225m (2010: US$190m), up 18%
-- Underlying* operating profit was GBP8.49m (2010: GBP6.22m), an increase of 36%
-- Underlying profit before tax was GBP8.13m (2010: GBP5.71m), an increase of 42%
-- Profit before tax, after exceptional goodwill impairment of GBP4.74m, was GBP0.36m (2010: GBP3.87m)

-- Net cash at year end was GBP5.46m
-- Underlying basic earnings per share was 22.01p (2010: 17.53p), an increase of 26%
-- Total basic earnings per share was 8.48p
-- Final dividend proposed of 9.6p (2010: 9.0p)
Operational highlights

-- 4imprint Direct Marketing
o Continued organic growth, gaining market share

o More than 450,000 orders received in North America, 20% ahead of prior year

o New customers acquired more than 20% higher than prior year

o Consistent customer retention rate, 60% of orders from existing customers

-- Enhanced transfer value exercise removed circa GBP10m of both the defined benefit pension liabilities and assets (reducing liabilities by 10%)

-- On 16 February 2012 the proposed sale of Brand Addition was announced for aggregate consideration of GBP24m, GBP12m to be used to reduce further the defined benefit pension scheme risk

[opener] 27/2/2012 13:24

Paul B- It is always a risk that key individuals may leave,but naming them?And naming them in the original circular when the announcements was made on the 16th?You are probably correct,all just standard stuff,it just doesn't smell that way to me.

[paul_butcher1999] 25/2/2012 10:23

Opener - the stuff in the circular about key persons etc (and all the other risks listed) are just standard lists of risks that they always set out in these kinds of dicuments (i.e. 'there is a risk key personell may leave' - well yes: of course there is: there always is - hence it is listed as a risk). This is just how these things are written.

Not commenting on whether good idea to sell or not though

[opener] 24/2/2012 17:05

Have read the document re the disposal a couple of times-can't quite figure out whether the "key persons" are leaving if this doesn't go through or not?It reads as if they have threatened to go and are forcing a sale of Brand Addition.The BoD have looked for a silver lining and are selling up before that happens.Why would you try to do this at the lowest ebb for gilt yields in history otherwise?The pension deficit surely can't get a whole lot worse than it is at the moment can it?The pension trustee has been happy for FOUR to pay good dividends to shareholders,they have the power to stop this if they felt the divi's were unsustainable,so the trustee can't be that worried. The sale price seems very low bearing in mind the cash generation and profits of the business.As per my earlier post after the announcement,the BoD are going to have to persuade me that this is a good idea and the disposal document has left as many questions unanswered as it has clarified-as ever all in my opinion!

[lennonsalive] 23/2/2012 08:02

Bounce off 220p perhaps?

[paul_butcher1999] 23/2/2012 00:21

choppa dont worry - will be back way passed recent peaks. this is a rapidly growing cash cow. Not many of them around. Growth stock with big dividend ...

[choppa] 22/2/2012 17:06

So that was a selling op then. Should have sold out when it spiked. Oh well.

[napoleon 14th] 18/2/2012 04:33

£24M is cheap imo, by 50% at least. = 90p/SH gross,
or how much after degearing the pension scheme?
Special div or buyback?

[opener] 17/2/2012 10:05

The market may be saying that this deal is not going to receive the required shareholder approval?Are the board saying that the two named individuals would be walking without the deal,so we had better sell?6x is cheap imo,even in cash,not sure that I will be voting for it without more information.

[interceptor2] 16/2/2012 16:23

I was looking at buying back in today but -

When I saw the disposal announcement, I expected it would be for the struggling SPS division, not the highly profitable Brands Additions division.

I know it's great to recieve the cash to pay down the pension deficit, but at 6 x profits ? Brands Addition also has a better profit margin than the Direct Marketing division.

Maybe I'm missing something.

So FOUR still on my watchlist and I will watch developments with interest.

ic2...

[granada7] 16/2/2012 14:26

After the disposal whats the cash position of the company?

[qs9] 16/2/2012 12:34

6 times and majority in cash is not a bad multiple in my humble opinion!

[rbcrbc] 16/2/2012 12:27

From the RNS:

"The Purchasers are newly incorporated companies ......"

"Christopher Lee, the Divisional CEO of Brand Addition, and Claire Thomson, the Divisional Finance Director of Brand Addition, are considered by the Board of 4imprint to be key individuals important to the business of Brand Addition. "

"For the six months ended 2 July 2011, the unaudited Brand Addition total revenue was GBP28.51 million and unaudited operating profit was GBP2.04 million. ...."

"The aggregate consideration for the Sale is GBP24.00 million "

Why mention Christopher Lee & Claire Thomson ?
Is this an MBO ?
24m for an annualised profit of £4 seems very very cheap to me.

[wjccghcc] 16/2/2012 11:12

It does look like they're lining up to sell the company. With Brand Addition gone and the pension deficit sorted, they only need to dispose of SPS. Then the US arm (67%) of sales with its strong growth and market leadership will be a very attractive takeover target.

[qs9] 16/2/2012 10:50

So pension deficit IMO should almost be eliminated, cash still good and US growth story intact....anyone got a TP post this?

[qs9] 16/2/2012 08:56

Need to work out how much of Market cap is now cash and then work out implied value of remaining business.....hopefully Market is telling us they very much like the end result so far IMO!!!

[cambium] 16/2/2012 08:48

LONDON (Dow Jones)--Promotional products supplier 4imprint Group PLC (FOUR.LN) said Friday it has sold two of its business units to a private equity firm for up to GBP24 million in cash.

The company said it has sold Brand Addition Ltd. and Kreyer Promotion Service, both of which provide promotional merchandise to medium and large businesses, to companies controlled by H.I.G. Capital LLC, a global private equity investor.

The initial fee for the sale is GBP22.75 million, with an additional GBP1.25 million payable a year after completion.

4imprint said the sale was consistent with its strategy of focusing resources on organic growth in its direct marketing business, adding that the proceeds of the sale would be used in part to pay down debt.